Canaan Launches $20M Buyback as Mining Equipment Sales Fall 96%
Canaan, the Nasdaq-listed Avalon mining-rig maker, launched an initial $20 million share repurchase under a $100 million authorization after its equipment revenue fell 96% in the third quarter. The company said it may sell more bitcoin to fund purchases, and most of its 1,875.5 BTC holdings were pledged or placed in a fixed-term product as of September 30.
Written by CoinArticle’s AI Newsroom · from 2 cited sources. How we work
The Buyback and Its Funding
Canaan launched a share repurchase program of up to $20 million in its November 10 announcement, drawn from a $100 million authorization its board approved on November 6. The authorization runs for 12 months, and the company has not committed to spending the full amount. Repurchases may be made in the open market, through private transactions or via block trades, and may involve American depositary shares or Class A ordinary shares.
The company said it will fund the program from cash and other available liquidity, with timing and size depending on market conditions and existing commitments. Canaan has also previously authorized management, in August, to use digital assets to support repurchases, and its September mining update showed it sold 3,952 ETH and 54.5 BTC for roughly $13.9 million. Of that, $5.4 million went toward buying back 13.6 million ADSs in late August. Total 2026 repurchases reached about 16.4 million shares by October 15.
Equipment Sales Collapse, Mining Revenue Holds Up Better
The buyback follows a steep drop in hardware sales. Mining equipment revenue fell to $4.8 million in the third quarter from $118.6 million a year earlier, a decline of about 96%. Canaan attributed the drop to weaker demand for mining machines and lower average selling prices, and said it sold computing equipment representing roughly 1 million terahashes per second during the quarter. Revenue from its own bitcoin mining operations was $9.5 million, nearly double its equipment sales but down from $30.6 million a year earlier. Total quarterly revenue dropped to $14.5 million from $150.5 million.
Profit Driven by Non-Cash Gains
Canaan reported an $8 million net profit for the quarter, reversing a $27.7 million loss in the third quarter of 2025. The company posted an operating loss of $42.9 million, so the profit rests on gains of about $52 million from revaluing its crypto holdings and financial derivatives. CFO James Jin Cheng said those gains were non-cash and separate from underlying operations.
Differing Accounts of the Bitcoin Position
The sources differ on how the bitcoin position should be read. CoinDesk's headline says most of Canaan's bitcoin was pledged or placed in a fixed-term product at the end of September, and the company's reported 1,875.5 BTC holding as of September 30 is consistent with that characterization. Crypto.news reports the same holdings figure but emphasizes the company's stated willingness to sell more crypto to fund purchases, without quantifying how much of the position is actually free to sell. Neither source gives a figure for unencumbered BTC, so the amount available for future sales is unclear.
Shares have fallen about 75% this year through November 11, according to market data cited in coverage of the announcement. Chairman and CEO Nangeng Zhang said the company believes its shares trade at levels that materially undervalue the business, and that it intends to buy more actively as funds allow while preserving liquidity for operations and infrastructure projects.
Why It Matters
For Traders
Any sale of Canaan's bitcoin or ether to fund buybacks would be visible on-chain and in its filings, so watch for transfers from its treasury wallets in the coming days.
For Investors
A 96% drop in equipment revenue alongside a buyback funded partly by crypto sales signals a business shifting from hardware sales toward self-mining and treasury management.
For Builders
Canaan's shift shows mining-hardware demand can fall sharply within a year, so firms building on hardware-linked revenue models should stress-test against similar declines.
This article is for information only and is not financial advice. Read the full disclaimer.
